SoftOx : Open and Download Complete Fourth Quarter 2021 Report

Report 4th quarter 2021

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SoftOx Solutions AS is a biotech company listed on Euronext Growth Oslo with ticker 'SOFTX'. SoftOx Solutions AS was founded in 2012 and is headquartered in Oslo. The SoftOx Solutions Group includes the holding company SoftOx Solutions AS, the Malmö and Copenhagen subsidiaries, and subsidiaries SoftOx Defense Solutions AS and SoftOx Disinfection AS. SoftOx has developed a highly effective antimicrobial solution which eradicates and prevents biofilm, viral and antimicrobial resistant infections. The technology is based on years of research and development in partnership with leading Nordic research institutes and is protected by patents.

Highlights for the 4th quarter 2021 and subsequent events

(Figures in brackets are comparable figures for 2020)

• SoftOx successfully raised NOK 50 million through a private placement December 15th.
• The Danish Medicines Agency (DKMA) approved the Phase I clinical trials for the SoftOx Inhalation Solution (SIS), and the first subjects are enrolled in the first-in-human trial to explore the safety and tolerability of single and multiple doses of inhaled nebulised SIS in healthy subjects.
• The first-in-human clinical study for the SoftOx Biofilm Eradicator (SBE) for infections in chronic wounds has improved its enrolment of patients and has completed the two first dose-levelcohorts.
• SoftOx won a tender by the Swedish Purchasing organization for chemical-technical products in both categories of "surface disinfection with sporicidal effect" and "hypochlorite-based surface treatment with sporicidal effect".
• The 4Q pre-tax results ended with a loss of NOK 20,5 million (loss of 20,5 NOK million). The year end result ended with a loss of NOK 86,3 million (loss of 49,7 million), pre-tax. Results are characterized by high levels of activity in research and development where approx. 50 % of costs are related to R&D.
• SoftOx Defense Solutions (SDS) submitted a grant application to the European Defence Fund for a pan-European consortium project, and the Norwegian Ministry of Defence has committed to co-financing NOK 10.6 million for the proposed project.
• The EU Commission's interpretation of the Biocidal Products Regulation allows SoftOx to enter the market with all its disinfectant products in the EU and EEA area. The Norwegian Environment Agency maintains its original interpretation that SoftOx is not allowed to sell during the transitional period, but SoftOx will defer to the EU Commission's interpretation.

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Key figures for the SoftOx Solutions Group (SoftOx) as of 31.12.2021

A statement from CEO Geir Almås

(Further details are also given later in the report)

The last quarter of 2021 solidified SoftOx's role as a developer of antimicrobial technology designed to address some of the world's biggest health challenges. The urgent need for our technology has only become more prevalent. The new COVID-19 variant is record-breaking despite widespread immunity from past infections and vaccinations - the application of our technology is clear. The SoftOx Inhalation Solution (SIS) can supplement vaccines as a broad spectrum, antiviral treatment that is independent of viral mutations. The SIS-01 study is making good progress in the first test of the inhalation technology in humans. We look to aid in not only the treatment but also the prevention of infections and illness, hopefully developing a new first line of defence for future pandemics. SoftOx Defense Solutions (SDS) is also working on an inhalation solution as a countermeasure for which we have applied for funding from the European Defence Fund (EDF) in cooperation with 19 partners including 9 EU countries.

In December, we received the long-awaited news that the EU Commission's interpretation of the Biocidal Products Regulation can allow SoftOx to enter the market with its disinfectant products in the EU and EEA area. The Norwegian Environment Agency (Miljødirektoratet) defends its previous decision of ineligibility for the transitional period; however, SoftOx will defer to the interpretation of the EU Commission and continue to sell. We look forward to rebuilding our sales force, and we are pleased that we were able to maintain our core sales team during this difficult period. The Norwegian hospital purchasing (HINAS) agreement is in place, and we have started to sell in 2022. On a larger scale, we have ongoing talks with international partners on the widespread potential of our disinfection line.

However, it should not be forgotten that there is another pandemic looming - antimicrobial resistance (AMR). Chronic wounds are hotbeds for resistant bacteria, and we are developing a product that has the potential be a great breakthrough in the fight against AMR in wounds. The SoftOx Biofilm Eradicator (SBE) is being tested for tolerability in a dose-finding phase I study, and the early study results are promising. We envision SBE as a replacement to traditional antibiotics in treating chronic

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infections, and thereby aiding in the fight of biofilm and antimicrobial resistance. Together with our preventative wound rinse, SoftOx Wound Irrigation Solution (SWIS), we believe that we have an innovative and disruptive technology for the wound care market.

In summary, there are many things happening at SoftOx, and we anticipate that 2022 will bring new opportunities and accomplishments in helping the world fighting infections. In November, we hosted a Strategy and Capital Markets Day to communicate our strategies and near-term goals for commercializing SoftOx's innovative technology. I strongly encourage all our investors and those who follow SoftOx to watch this presentation to understand the company's position and plans to come. Following a successful yet challenging year, we are energized by our plans for 2022.

Geir Hermod Almås, Chief Executive Officer

Operational update on research and operations in 4Q 2021

Research and product development

Product development methodology

Figure 1. SoftOx product pipeline

Platform technology

In collaboration with leading scientific teams, SoftOx has discovered a unique synergetic effect of two natural components, proven to be well tolerated by both humans and animals even when used in wounds. This unique technology is protected by a robust patent portfolio which provides multiple degrees of freedom to expand into new therapeutic applications. SoftOx has filed 84 patents worldwide, of which 58 are granted addressing formulations, uses, methods of making and devices.

The SoftOx technology has proven strong antimicrobial effects on various bacterial species (including multidrug-resistant bacteria and those embedded in biofilms), fungi, spores and viruses. Importantly, our research has also determined that this novel solution does not induce microbial resistance.

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The safety profile and the antimicrobial efficiency of the technology make it acceptable for multiple applications with the aim of preventing and removing infections. After thorough and successful laboratory and animal experiments, SoftOx has now entered the clinical phase with several product leads, including i.e., topical wound and inhalation treatments.

Wound Care

Infection prevention

SoftOx Wound Irrigation Solution (SWIS):

SWIS is intended for acute wounds and was developed to rinse wounds to prevent infections and biofilm formation. The medical device uses a lower concentration of active ingredients compared to SBE, which makes it well-tolerated and safe when applied to wounds. The current recommended treatment solution for acute wounds is saline water, which holds 80% market share. Based on the clinical evidence generated on safety and effect, the goal of the Company is to replace today's wound rinsing products with SWIS as a low-risk product with added beneficial properties.

As previously announced, the final confirmatory clinical investigation (SWIS-02 trial) was recently completed. The SWIS-02 study showed both significant improvement in wound healing and reduction in bacterial burden compared to Normal Saline (NS), positioning the product as superior towards today's market leaders. The results of SWIS-02 has now been summarized into a manuscript for publication in an international medical journal. The study has also been reviewed by the European Wound Management Association (EWMA) Scientific Committee and accepted for oral presentation at the EWMA-CICA 2022 Conference in Paris, 23-25 May.

Furthermore, the Company is working diligently on establishing a Good Manufacturing Practice (GMP) pilot facility at Fornebu, setting up a quality management system (QMS) and developing the final design dossier to be sent to a Notified Body and Competent Authority for approval of SWIS as a medical device in Europe. Establishing a high-quality production facility at SoftOx will add value for all future research projects within the medical device and pharmaceutical development areas.

SWIS is expected to be SoftOx's first CE-marked product for the European market. The Company has also started preparing an application to obtain US clearance by the US Food and Drug Administration (FDA) for SWIS as a medical device through the pre-marketnotification (510(k)) route.

Infection removal

SoftOx Biofilm Eradicator (SBE):

SBE functions as an infection treatment in chronic wounds and is designed to have therapeutic effect by penetrating and killing microbes within biofilms. The formula penetrates deep into the wound bed, yet it is non-toxic and safe to use, based on animal studies. SBE kills antibiotic resistant bacteria and does not induce new resistance which may lead to a reduced use of antibiotics and fewer antimicrobial- resistant microbes. Hopefully, it will also be the first major defence against resistant bacteria, which spread rapidly and develop new resistances quickly. Studies have shown that antimicrobial resistant bacteria are found in more than 50% of chronic wounds.1

• Trivedi, U., Parameswaran, S., Armstrong, A., Burgueno-Vega, D., Griswold, J., Dissanaike, S., & Rumbaugh, K. gP. (2014). Prevalence of Multiple Antibiotic Resistant Infections in Diabetic versus Nondiabetic Wounds. Journal of pathogens, 2014, 173053. https://doi.org/10.1155/2014/173053

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